Underlying strength and earnings growth prospects make American National Bankshares Inc. AMNB a solid bet now. The company’s Zacks Consensus Estimate for the current-year earnings has been revised marginally upward over the last 60 days, indicating analysts’ optimism about its earnings growth potential. As a result, the stock currently carries a Zacks Rank #2 (Buy).
The stock has gained 3.5% so far this year compared with 6.7% decline for the industry it belongs to.
Given the positive estimate revisions and a solid Zacks Rank, we expect a decent upside for the stock in the near term.
Here are the other aspects that make the stock an attractive investment option:
Earnings per Share (EPS) Growth: American National has witnessed EPS growth of nearly 13.8% in the last three-five years, higher than the industry’s growth of 13.5%. This earnings momentum is likely to continue in the near term, as reflected by the company’s projected EPS growth of 9% and 16.5% for 2017 and 2018, respectively.
Also, the company has a decent earnings surprise history, having delivered an average beat of 6.4% in the trailing four quarters.
Strong Leverage: American National’s debt/equity ratio is 0.18 against the industry average of 0.31, indicating a relatively lower debt burden. It also indicates the company’s financial stability even in adverse economic conditions.
Superior Return on Equity (ROE): American National has an ROE of 7.89%, slightly better than the industry average of 7.57%. This shows that the company reinvests its cash more efficiently.
Other Stocks to Consider
Other top-ranked stocks in the same space are Farmers Capital Bank Corporation FFKT, Popular, Inc. BPOP and Carolina Financial Corporation CARO.
Farmers Capital has witnessed an upward earnings estimate revision of 5.1% for the current year, over the last 60 days. Its share price has increased 28.3% in the last 12 months. The company currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Popular’s earnings estimates for the current year have been revised 3.5% upward over the past 60 days. Its shares have gained 4.4% in the last 12 months. It also carries a Zacks Rank #1.
Carolina Financial carries a Zacks Rank #2. The company witnessed an upward earnings estimate revision of 8.9% for the current year, over the last 60 days. Its share price has increased 55.5% in a year’s time.
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Popular, Inc. (BPOP) : Free Stock Analysis Report
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